The Logistics Simulation

The Logistics Simulation

Each participant is part of a management team managing a logistics company, in competition with five other teams. The programme can be run over 1 or 2 days, simulating 4-5 financial years and depending on the level of teaching and debrief that is included. Each team will decide on which customer segments to compete in, make capital and operational investments, take out loans, research the competition and make decisions based on their position in the marketplace. Each customer segment has different criteria for customer retention and new business.

The goal is to outperform the competitors by creating more profit and value than them, while maintaining cash flow. In between each competitive round, participants receive teaching inputs to enhance the learning.

Each ‘year’, and after making strategic initiatives to retain or win new contracts and make the necessary investment in logistis infrastructure, participants would need to prepare a financial analysis of their respective team’s performance. The facilitator in turn facilitates a debriefing session on key learning points.

The Objectives

The programme was originally developed for the European operations of a global logistics company. It is designed to give a global overview of how the logistics business works and to make the learning of strategic planning, marketing and financial concepts as easy and enjoyable as possible. It is a fast-paced and highly challenging programme that focuses on the following goals

1. Strategic Thinking & Decision Making
a. Decide to compete primarily on price and operating efficiencies OR by business development effort and depth of expertise in a specific industry b. Decide on aggressive growth through acquisitions, or slower growth by organic means.

2. Employee Alignment & Engagement
a. To make the realisation on how the participant’s role and actions impacts the business objectives of their organisation.

3. Commercial Understanding
a. Understanding the financial elements of the logistics business.
b. How strategic (investment in warehouses and trucking) and operational (eg. resource allocation) decisions have an impact on the commercial aspects of the business.